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Revisions to Evaluation of Corporate Compliance Programs

Rebecca Walker (rwalker@kaplanwalker.com) is a partner in the law firm of Kaplan & Walker LLP, which specializes in corporate compliance and ethics, located in Santa Monica, California, and Princeton, New Jersey.

In June, the Department of Justice (DOJ) issued a revised version of its guidance to prosecutors regarding the factors that prosecutors should consider in making “informed decisions as to whether, and to what extent, the corporation’s compliance program [is] effective…for purposes of determining the appropriate (1) form of any resolution or prosecution; (2) monetary penalty, if any; and (3) compliance obligations contained in any corporate criminal resolution (e.g., monitorship or reporting obligations).”[1] The guidance includes a number of very detailed questions regarding assessment of the efficacy of a compliance program and is, therefore, an important resource for compliance practitioners.

The 2020 revisions to the evaluation guidance, while not extensive, are meaningful. They focus in on some of the most important developments in the compliance field in recent years. Taken as a whole, they point squarely and unambiguously to the importance of continuous program assessment and improvement. They also tackle the topic of the use of data and metrics to improve programs, as well as the importance of program authority and independence. In this article, we will explore the changes to the evaluation guidance in detail, but before getting to that, we’ll set the stage with a little history.

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